China Merchants Group Focuses on Investing in Mainland's Logistics Sector
By: South China Morning Post January 22, 2014
China Merchants Group will take advantage of merger and acquisition opportunities in the mainland's fragmented logistics and infrastructure sector as local governments deleverage, said the company's chairman, Fu Yuning.
"There will be lots of mergers and acquisitions in the logistics industry in China as oversupply will lead to industry consolidation," said Fu, also the chairman of Hong Kong-listed China Merchants Holdings (International) and China Merchants Bank, on the sidelines of the Asian Financial Forum.
There are over 100,000 logistics players on the mainland but there is a lack of major players with advantages of scale.
China Merchants' logistics arm will expand its services to upstream and downstream customers, Fu said.
Over the past 20 years, China Merchants has established a network to support nationwide sales outlets for brands like Tsingtao Beer, Coca-Cola and Procter & Gamble.
It is now aiming to further develop supply chain services for manufacturers on the mainland as well as last-mile delivery services, which have received a big boost because of the enormous growth of e-commerce.
With the recent acquisition of a minority stake in SF Express, one of the major courier companies on the mainland, China Merchants is seeking to leverage the e-commerce boom.